Rural Women Are the 'Investable Half' Missing From Climate Finance, IFAD Report Says

IFAD introduced a US$70 million climate adaptation bond at COP31, the first global adaptation bond focused specifically on rural communities.

Rural women play an essential role in producing food, managing natural resources, and supporting local economies, yet they still receive inadequate financial support to protect their livelihoods from climate change. A new report released at COP31 by the International Fund for Agricultural Development (IFAD) and Türkiye's Ministry of Agriculture and Forestry highlights how unequal access to climate finance leaves women farmers and rural entrepreneurs especially vulnerable to environmental and economic shocks. The report, titled The Unfunded Half – Financing Rural Women's Resilience: From the Bond Market to the Farm, calls for financial systems that recognise women's contributions to agriculture and provide them with better opportunities to invest in climate resilience.

Women represent approximately four in ten agricultural workers worldwide, making their participation essential for food production and the stability of rural communities. Despite their responsibilities, women have less access to agricultural land, farming inputs and financial services, and they earn just 82 cents for every dollar men receive in agricultural wage employment. These inequalities make it harder for women to invest in their farms, improve productivity, and prepare their families for the financial consequences of extreme weather and other climate-related disruptions.

Financial institutions frequently consider women borrowers expensive to serve, even though evidence presented in the report identifies them as reliable borrowers who can make productive use of financial support. Describing rural women as "the investable half," the report challenges the assumption that providing agricultural finance to women represents an unattractive investment opportunity. IFAD President Alvaro Lario stressed that investing in rural women can strengthen agricultural productivity, food security and economic resilience across entire communities.

Only a Small Share of Climate Finance Prioritises Gender Equality

The report reveals that around 80 per cent of international public climate finance directed toward agrifood systems considers gender equality in some form, but very little funding is specifically designed to address women's needs. Just three per cent of this financing, equivalent to approximately US$855 million annually, identifies gender equality as its primary objective. This difference raises concerns about whether existing climate investments are doing enough to overcome the financial and structural barriers faced by women working in agriculture.

Limited access to finance can prevent women from purchasing productive equipment, securing agricultural resources and protecting their assets against climate-related losses. Lario emphasised that financial instruments such as adaptation bonds, matching grants, guarantees and insurance must be developed in ways that allow women to benefit directly from available funding. The report encourages governments, development institutions and financial organisations to recognise that supporting women farmers can improve the resilience of food systems and rural economies.

IFAD's $70 Million Adaptation Bond Opens New Financing Opportunities

IFAD introduced a US$70 million climate adaptation bond at COP31, the first global adaptation bond focused specifically on rural communities. The privately placed bond brings institutional investment into IFAD's financing operations, supported by the organisation's AA+ credit rating and its established approach to rural development. Funding mobilised through IFAD is subject to the organisation's gender targets, providing a framework for ensuring that investments consider women's financial inclusion and report transparently on their results.

The initiative demonstrates how capital markets could provide additional resources for agricultural communities facing increasing climate risks, including women whose access to conventional finance remains limited. IFAD believes that linking private investment with clear gender objectives can create financing opportunities that respond more effectively to the difficulties faced by rural women. Its approach also highlights the importance of accountability, allowing investors and development institutions to understand how their contributions support adaptation and economic opportunities.

Better Financial Services Could Strengthen Women's Climate Resilience

The report recommends financial products designed around the practical challenges women encounter when seeking loans, insurance and investment support for agricultural activities. These could include credit arrangements that do not require land ownership documents, insurance distributed through women's organisations and financial assistance that enables women to purchase equipment and productive assets under their own control. Such measures could help women make independent economic decisions, strengthen agricultural businesses and prepare for environmental shocks without depending entirely on emergency assistance.

Türkiye's Minister of Agriculture and Forestry, İbrahim Yumaklı, described women as central to the country's agricultural sector and the ability of rural communities to withstand climate disruptions. He stressed that financial assistance, insurance and other forms of support must reach women producers before climate emergencies occur, rather than becoming available only after their farms and livelihoods have suffered damage. This approach could give women more opportunities to protect their income, maintain agricultural production and support their families during increasingly unpredictable climate conditions.

Improving the availability of finance also requires stronger evidence about how women access financial services and manage repayment obligations, according to the report. Better tracking of women's borrowing experiences, access to financial products and loan repayment performance could help lenders assess financial risks using reliable data instead of assumptions about women borrowers. By combining targeted climate investment with more inclusive financial services and transparent reporting, IFAD hopes to make rural women's economic resilience a stronger priority within global climate financing.